Pay bump for public workers boosts Australia’s wage growth reading
Australian wages rose 4.1 per cent in the 12 months to June but growth is slowing for private sector workers.
That’s about the same pace as data running to the March quarter, according to the Australian Bureau of Statistics.
But the latest figures were boosted by a pay rise for Commonwealth public sector workers in a single hit in March.
Wages in the private sector lifted at a slower rate in June than the previous quarter.
“The June quarter 2024 private sector rise was . . . the equal lowest rise for any quarter since December quarter 2021,” ABS head of prices statistics Michelle Marquardt said.
”The stronger June quarterly rise for the public sector was largely due to the newly synchronised timing pattern of Commonwealth public sector agreement increases.”
The Reserve Bank’s recent quarterly rundown on the economy suggested a pace above 4 per cent might be too fast to keep a lid on inflation. given low productivity growth.
The RBA said that may not be sustainable in the long term.
“(W)e assess that the current pace of wages growth cannot be sustained in the long term without a higher pace of trend growth in productivity,” the RBA said of the data up until the March quarter.
The wage index tracks the cost of labour but does not include pay rises from promotions, new jobs or shifts in the workforce. That means the figure usually grows at a slower rate than take-home pay for workers.
Federal Labor campaigned on lifting growth in wages, after the post-pandemic inflation breakout drove real wages backwards.
In government, policies have included laws to give unions more power to drive enterprise bargaining deals and subsidising pay rises for care workers.
But inflation has continued to run at a faster than expected pace, pushing wages down in real terms.
More to come
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